THE MEDIA BUSINESS

THE MEDIA BUSINESS; Offers Being Sought for U.P.I. and FNN

By GERALDINE FABRIKANT

Published: November 8, 1990

The newly appointed co-chief executives of Infotechnology Inc. yesterday put the Financial News Network and United Press International, the company's major holdings, up for sale.

The troubled company had said recently that it was not making enough from its operations to meet expenses or to cover maturing bank loans and FNN's lease obligations.

The executives, Alan J. Hirschfield and Alan Tessler, said they believed a sale would satisfy the company's obligations. 35 Million FNN Subscribers

Mark Riely, an analyst at MacDonald, Gruppo & Reily, an investment and research firm, indicated that FNN, which has 35 million subscribers and is expected to generate about $40 million to $50 million in revenues in its current fiscal year, could fetch $150 million or more. Cable television services like FNN are generally selling for $4 to $5 a subscriber.

FNN has $49.5 million in bank loans and approximately $88 million in equipment lease obligations due over the next five years. Mr. Hirschfield said yesterday that a deal could be structured in which a buyer would assume some debt and pay less cash. He indicated that a number of big media companies had already indicated an interest.

But no deal was apparently imminent, and with the value of media properties currently in decline, it might be difficult to get a top price, according to at least one industry expert who declined to be named.

"There may be other undisclosed shareholder litigation," this person said. "That is a key unknown."

Still, the service might be considered strategically valuable to companies like Viacom, Time Warner, Turner Broadcasting, Capital Cities/ ABC or Tele-Communications, all of which own or have an interest in cable services.

FNN also has a substantial interest in the Learning Channel as well as three data services, which would be packaged and sold together. U.P.I. Deal Tougher

United Press International faces serious financial problems and continues to lose money, making it more difficult to determine who might be a buyer and how the price would be determined. The company has changed ownership three times in the last eight years.

John Brewer, editor in chief of The New York Times New Service, a rival news service, said: "It is not immediately clear who a buyer would be. It would take someone with very deep pockets. You have to do so much as a general news service. It costs a fortune. It may appeal to an ego-driven buyer, but every recent buyer has failed. It is like buying the Hope Diamond. It looks good, but there is a lot of bad luck attached. It is terribly sad. "

The 83-year-old U.P.I. recently asked union workers to take wage cuts. Managers and other nonunion workers had already been told they must accept similar cuts.

The sales will be handled by Wertheim Schroder & Company, the investment bank with which Mr. Hirschfield is associated.